Banking and Infrastructure in Developing Financial Services Markets
Banking and Infrastructure in Developing Financial Services MarketsA few slides on recent challenges in a few developingmarkets, showcase of a few Rabo Development partnerbanks.Dan ArmstrongTakashi Mobile, 30 November 2011
Distribution as a Customer Acquisition Tool Banked Customers Time
Distribution : Banking and Banking Usage Trends Alternative Traditional Physical Virtual
Rabo Development Rabobank Development is a division of Rabobank International, one of the world‟s largest food/agri-banks • Wholesale banking in 48 countries, 59.000 Rabobank employees • AAA status as a retail bank, but focused on rural/retail and agri-banking Rabo Development partners/takes minority equity in banks in developing countries that match this historical profile and skillsets. In addition to support in food/agri- and basic banking services, Rabo Development also supports partners with brick-and- mortar branch network strategies, channels/automation projects (mobile, ATM, internet), banking products, fraud and in- country personnel.
Rabobank World-Wide KeyRabobank Group Rabo Development 48 countries, 59.000 employees Rabo International – Retail & Wholesale Partner Banks: Brazil, Paraguay, Zambia, Tanzania, Rwanda, Mozambique, China Robeco, Sarasin, Orbay, Obvion, Interpolis, Rabo International - Wholesale Lage Landen, Athlon , etc. Projects: Egypt, Malaysia, Vietnam, RIAS & Rabo Development Kazakhstan, Pakistan, Ukraine, Malawi, etc. Main focus on food and agri-banking, cooperative banking, and retail Rabobank Foundation
Banking in Harsh Environments Bringing compute resources and solutions to banks in remote locations with limited infrastructure is a major challenge: • Fixed line internet connectivity (fibre, WiMax) and, if available, huge cost • Mobile internet connectivity (GSM/HSDPA, GPRS/EDGE, WCDMA, etc.) • Power (lack of power at all, or lack of stable power and/or UPS) • Weather conditions (humidity, flooding, sun exposure, lack of closed buildings and server environments) • Environmental conditions (dust, exponentially higher maintenance cycles) • Security of computing platforms (theft, transport, as well as e.g. stolen cooper phone wire for other purposes like jewelry) • IT skills (system set-up, monitoring, maintenance, usage of computers) • Literacy
Generating Successful Formulas Currently has / uses another financial product Too poor Redistribution Zone Target / Does not have Excluded by design Addressable access to the Market product Excluded by default Development Zone Does not have / use a financial product Does not want the product Has access to the product, but does not use it Potential users Enablement Zone Based on: http://www.bankablefrontier.com/assets/pdfs/access-frontier-as-tool.pdf
Zanaco 40+ years of success, growth and stability, successful expansions, privatisation and IPO 450.000 customers, 1.200 employees, 50 branches Year-on-year profitability, K3 bln in assets, mature risk management regime. Healthy account portfolio including: • Retail: account services, personal loans, e-banking, Xapit, remittances, cash services • Corporate: credit facilities, e-banking, cash services, treasury and investments, trade services Transformation to modern banking tools: 100+ ATMs, internet banking, mobile banking
Xapit Instant Banking Mobile Banking: Launched in late 2008, USSD mobile banking • 250.000+ customers to-date • 20+ bill payment partners, prepaid airtime, etc., 21 transactions per month Light Account: Also, Xapit „account‟ = welcome pack + mobile banking + ATM card DSA: Sign-up for an account *444# and get mobile banking and a VISA debit card in 5 minutes. Agency Banking: 123 ZamPost agency locations Truck Banking: Zanaco mobile banking vehicles
FMB Fast Account First Merchant Bank (Malawi) • 19 branches, corporate and retail banking, 600 employees, growing strongly • 1/11 commercial banks in Malawi FMB Mobile / FMB Fast Account • Launched summer of 2010, 50.000+ customers to-date • Successful to-date – packaging of ATM card, bank account and mobile banking functionality • *** Includes immediate (small) balance on customers’ account, facilitating usage of the new product
Case Study: NMB Tanzania NMB: National Microfinance Bank Ltd. • Also by-far the largest bank in Tanzania • 1.9 mln customers: regular Tanzanians, all teachers, army, etc. • ATMs in place (400+), most customers have ATM cards • 150 connected branches (100%) However, as a former government bank: • Must handle bill payments, salary dispersal and non-customer transactions • Major queue problems
NMB mobile – mobile banking Dial *155*66# to access Features: • Balance Inquiry • Mini-Statement NMB mobile 1. Balance Enquiry • Money transfers to any NMB account 2. Mini-Statement 3. Money Transfer • Tanesco Luku Prepaid Electricity Purchase 4. Prepaid Services 5. Other Services • Vodacom and ZAIN Prepaid Airtime Top-Up 6. Help • NMB Services like ATM card block, settings No need to fill-in forms or visit an NMB branch to sign-up, simply dial *155*66*123# NMB mobile: • Launched in August 2009 • 550.000+ active customers to-date • All mobile networks, 100% nation-wide coverage • SMS Alerts to 220.000 customers monthly
BPR Rwanda BPR (Banque Populaire du Rwanda) is by far the largest bank in Rwanda • “Bank of the people” with roots in cooperative and food/agri-banking (>85% of Rwandans are farmers) • 1,3 mln accounts (8x larger than the second largest bank) In 2011, 47/191 BPR branch banks were automated: • Around 150 locations use paper-and- pencil ledgers • Staff may have no previous experience with computers • Fraud and information integrity are problems. • Customers can only bank at one bank location.
BPR Mobile Banking “Project Columbus” • Automating all 191 branches in 14 months • Mobile internet (incl. USB modems, laptops) • Data migration, training of staff and customers, card distribution New BPR E-Channels • BPR Mobile Banking (launched 09/2010, 110.000+ customers to-date) • BPR SMS Alerts • BPR ATM Cards • BPR QuickCash ATMs • BPR Call Centre
BPR “Quickcash” ATMs Quickcash and ATM Cards • 100 BPR ATMs online in 2011 throughout Rwanda (donated by local Rabobanks) • Increased ATM usage through new marketing and promotions, usability campaigns and POS roll-out New E-Banking Call Centre • BPR call centre successful operating, incl. ACD/call queue system • Inbound and outbound calling to improve usage, sign-ups and customer satisfaction • 650-1.000 calls per day, service level is 85%+
BPR Mobile Banking Mobile Banking 1. Balance Inquiry 2. Mini-Statement 3. Money Transfer (BPR Accounts) 4. Prepaid Airtime • MTN • Tigo (pending) 5. Bill Payments • RECO Prepaid Electricity • StarTimes Africa TV • DStv • MTN Postpaid Bill • Tigo Postpaid Bill (pending) 6. Bank Services • Change BPR Mobile Banking PIN • Change Language • Order Cheque Book 7. Help
BPR: Simbuka Creating awareness of technology and it‟s benefits for Rwandans Automatically include new technologies in new account packages. Bring older (loyal) customers along with the launch of new services.
Challenges in Rwanda, Tanzania and Elsewhere Utilities Costs • high-quality power • connectivity (VSAT, 2G/3G, land • paved roads lines) • generator electricity only option in Environmental conditions some remote locations (costly) • heat • high-quality solar still expensive • humidity • but GPRS is being widely available • dirt and can be a cheap and effective solution – both for connectivity and Knowledge for electricity • project management Cultural Acceptance • branches as ambassadors • technology acceptance • trained technicians • trust • maintenance and support personnel • usability Equipment • PIN/2FA • spare parts • local hardware/software licenses
Thank You! Dan Armstrong, +31652085071 www.rabobank.nl email@example.com www.rabobank.com